Sunak Closer to Become New UK Prime Minister as Johnson Withdraws

Market movers today Today’s key focus will be the October Flash PMIs. We expect further signs that euro area is sliding towards a recession already this year, while US growth remains modestly positive. On the political front the UK Conservative MPs will select the two final candidates this afternoon and after Boris Johnson pulled out […]

A Busy Week Ahead: US Big Tech Earnings, BoC, ECB, BoJ Decisions and UK PM

Last week ended on a strong positive footage, on hints that some Federal Reserve (Fed) officials have started talking about pausing the interest rate rises to avoid going too far. Chicago Fed’s Evans warned that pushing the Fed funds beyond 4.6%, from around 3 to 3.25%, would ‘really begin weighing on the economy’, while San […]

Another Whipsaw Day for the Yen

The Japanese yen is sharply lower today, as USD/JPY has climbed 1.2% and is trading at 149.41 in Europe. The yen continues to exhibit strong swings for a second straight session. The yen started the week with sharp gains and jumped to 145.28, but the dollar has recovered and pushed the yen back above 149. […]

Euro Slips Lower on Soft German PMIs

EUR/USD has edged lower at the start of the week. In the European session, EUR/USD is trading at 0.9824, down 0.37%. Manufacturing, services PMI point to contraction Germany is the locomotive of the Eurozone, and a faltering economy means trouble for the entire bloc. German Service and Manufacturing PMIs remained in contraction territory in September, […]

November Flashlight for the FOMC Blackout Period: Our Expectations Ahead of the November 2nd FOMC Meeting

Summary We look for the FOMC to deliver its fourth consecutive 75 bps rate hike at the conclusion of its meeting on November 2. Inflation continues to run much too hot for the FOMC, and the labor market remains extraordinarily tight. The odds of a 100 bps rate hike on November 2 are low, in […]

China is Under Pressure

After a delay related to the Communist Party congress, China published a batch of monthly and quarterly statistics, which caused mainly disappointing reactions from analysts. GDP added 3.9% in the third quarter compared to a year earlier against expectations of 3.5%. In the three quarters, the economy added 3.0% over the same period a year […]

Rishi Sunak Set to Become UK's New Prime Minister

Markets Investor attention was focused on the release of PMI business confidence today. As one could have expected, they didn’t really paint a rosy picture on the European economy. They scream “stagflation” with the Eurozone economy having slipped into a deeper downturn at the start of the final quarter. High energy prices weigh on activity […]

Pound Drifting, Sunak Takes Over as PM

The pound pushed higher at the start earlier today but has given up all of these gains. GBP/USD is trading at 1.1293, down 0.03%. Sunak takes over as PM Rushi Sunak has become the new UK Prime Minister after Penny Mordaunt dropped out of the Conservative leadership race. Liz Tross beat Sunak for the leadership […]

Too Soon for Fed to Pivot

Market movers today In Germany, the IFO survey of business expectations is expected to show further declines mirroring yesterday’s weak PMI report for the manufacturing sector. This supports our view that the German economy is likely to fall into recession in Q3, which together with high inflation makes it difficult for both the ECB and […]

Ready for Rishi

After both Boris Johnson and Penny Mordaunt pulled out of the British PM race, Rushi Sunak cried victory on Monday afternoon, and markets cried ‘Ready for Rishi’. The British sovereign bonds posted one of the biggest gains on record, the 10-year gilt yield tanked 8.50%, the 30-year yield dived 8.40%, sterling gained, but Cable remained […]